WORLD
Renault to axe 7,500 French jobs
Baku, January 16 (AZERTAC). France`s Renault underscored the challenge facing Europe`s carmakers amid falling demand as it announced on Tuesday the loss of 7,500 jobs in the country, equivalent to 17 per cent of the domestic workforce, during the next three years.
The jobs losses were needed to lower its cost base - resulting in annual savings of €400m - and to maintain investment capacity, the carmaker said.
France`s Renault underscored the challenge facing Europe`s carmakers amid falling demand as it announced on Tuesday the loss of 7,500 jobs in the country, equivalent to 17 per cent of the domestic workforce, during the next three years.
The jobs losses were needed to lower its cost base - resulting in annual savings of €400m - and to maintain investment capacity, the carmaker said.
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Gerard Leclercq, Renault`s head of operations in France, said: “If an agreement is signed with unions, this staff redeployment would require neither a plant closing nor any forced departures.”
Citing “the persistent uncertainty in the short term in Europe”, Renault said it needed to reduce its break-even point by 12 per cent from the 2.72m of vehicle sales made in 2011.
Under the terms of the plan presented to unions, 5,700 jobs cuts would be made through attrition and the remainder through a voluntary early retirement package.
Carlos Ghosn, Renault`s chief executive, attending the Detroit motor show, said that he expected the European car market to fall another 3 per cent this year after contracting in 2012 to a two-decade low.
Sergio Marchionne, Fiat`s chief executive, said at the show that Europe`s volume- car industry was in a “painful” situation. He said his request for a European Union plan to cut carmaking capacity to match demand had been “ignored”.
The Italian carmaker said in December that it would cut 1,500 jobs at its Polish operations to reduce production.
Renault`s larger domestic rival, PSA Peugeot Citroën, Europe`s second-biggest carmaker by volume, is also eliminating 17 per cent of its domestic workforce - or 11,200 French jobs. It has closed its Aulnay plant outside Paris and its in-house bank was rescued last October by a €7bn government guarantee.
Other carmakers are also reducing capacity in the face of economic austerity in many of Europe`s debt-laden countries. Ford at the end of last year announced plans to shut nearly a fifth of its plant capacity in Europe, involving stopping operations at three factories and cutting 5,700 posts.
General Motors plans to shut Opel`s factory in Bochum, Germany by 2016, putting 3,100 positions at risk, while last week Honda, the Japanese carmaker, said it would axe about 800 jobs at its plant near Swindon in southwest England.
New car registrations in Europe fell by 10 per cent in the year to November and they were down by 13 per cent in France, according to industry figures.
The continent`s car market shrunk by 3m units to about 12m since 2007, according to Acea, the European carmakers` association, and sales in 2012 are expected to be their lowest since 1995.
However, Volkswagen, Europe`s biggest carmaker by volume, said this week it did not plan to reduce capacity in Europe.
Shares in Renault rose by 2 per cent to €41.59.